SMALL BUSINESS
MANAGEMENT
Chapter 14
Managing Growth
Joe Six Pac
Joe Six Pac
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What recommendations would you
make for the two companies in
regards to future growth?
The Business Cycle
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Introduction
Growth
Maturity
Decline
Super Bacteria
Problems Created by Growth
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Owner-Manager Fatigue and Stress
Lack of Communication
Lack of Coordination
Shortage of Cash
Low Profitability
Problems Created by Growth (cont.)
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Breakdowns in Production Efficiency
Lack of Information
Decreasing Employee Morale
Owner Lifestyle
Golf Gifts
Evaluating the Growth Question

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Is the business one that can grow ?
Is the business owner prepared to
make the effort ?
Does the owner-manager have the
capabilities to grow?
How should the owner-manager
pursue growth ?
Evaluating the Growth Question (cont.)

Growth options

new markets for the product or service

increased sales by increasing frequency of use.

add new products or services or modify
existing ones.

new uses for present products or services

acquire other small companies
Sports Cars
Planning for Growth

The Expansion Plan

set objectives

determine alternatives

select the best alternative
Planning for Growth (cont)

Understanding the Requirements of
Growth
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Greater Management Depth
Intelligent Expansion
Additional capital
Financial Information
Organizational Change
Implementing Managerial Controls
Monitoring the External Environment